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Griglak v. CTX Mortgage Company, LLC

2010 WL 1424023 (U.S. Dist. Ct. D. N.J. 2010) (Unpublished)

TRUTH IN LENDING ACT; RESPA; STATUTE OF LIMITATIONS — Even where a claimant exercised reasonable diligence in investigating its claim, equitable tolling of a statute of limitation, including under RESPA and the Truth in Lending Act, is appropriate only where the alleged wrongful actor actively misled the claimant regarding the cause of action or where a claimant, in some extraordinary way, was prevented from asserting its rights, or where the claimant timely asserted its rights, but in a wrong form.

Homeowners refinanced their home loan with a bank. Later, they sued the lender in state court, claiming that the bank had violated the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA). They also asserted several state law claims. The homeowners claimed that the bank violated the TILA by providing them with inaccurate or conflicting loan documents and by making false promises and representations that interfered with their ability to assess the transaction. The homeowners also claimed that the bank violated RESPA by accepting fees for work it did not perform and by charging costs and fees at closing that exceeded the amounts listed in the good faith estimate.

The bank had the matter removed to federal court. It then moved to dismiss the claims for failure to state a cause of action. The court dismissed the TILA and RESPA claims. Actions under the TILA may be brought for both damages and loan rescission. A damages claim must be brought within one year after the date of violation. A claim for rescission must be brought within three years after the date of the transaction or the date the property is sold, whichever comes first. A claim under RESPA must be brought within one year (for claims under Sections 2607 or 2608) or three years (under Section 2605).

The borrowers did not contest the applicable statutes of limitations, but argued that the statute should be tolled. The Court disagreed, noting that equitable tolling of a statute of limitations is appropriate where: (a) a defendant actively misled the plaintiff regarding the cause of action; (b) the plaintiff, in some extraordinary way, was prevented from asserting its rights; or (c) where the plaintiff timely asserted its rights, but in the wrong forum. Further, a party seeking to toll the statute of limitations must show that it exercised reasonable diligence in investigating the claim. In addition, courts will not toll the statute absent a showing of “intentional inducement or trickery.” In this case, the Court found that the homeowners failed to show that they were misled, or that they were prevented (in an extraordinary way) from asserting their rights, or that they diligently investigated any causes of action they may have had against the bank.

Therefore, the Court concluded that the statute of limitations applied, without any tolling, and it dismissed their complaints.


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